54 PROCTOR | October 2016
The matter
and the money
How to talk confidently and concurrently about both
The essence of ‘Getting paid:
Start with file opening’ was that
responsibility for slow or poor
payment by clients rests mainly
with producers and principals.
In fact, we observed that only two out of
16 causes were down to the client. We then
proposed some simple steps that should
always lead to improvement.
And yet, even in firms that work hard on
building structure and rules around credit
control, we continually run into producers
who are really challenged by talking with
clients about money.
While there are signs of improvement, many
firms still don’t quite get the balance right.
They put effort into rules, policies and follow-
up, but little into training and coaching in
better conversations. Which leads into the
purpose of this article...
We think that we’ve pretty much nailed
why many producers don’t do money
conversations well.
Money conversations
aren’t what I’m here for
Firstly, they avoid them. They do this because
they see matter conversations as normal. It’s
what they are trained in. And mostly, if they
are reasonably confident/competent with the
particular law, there is little to fear.
But money conversations are different.
They can involve higher risks and greater
potential for conflict. They aren’t seen as
normal. They aren’t seen as a key part of
what I’m here for. And if producers hold out
for long enough, they can actually make
these conversations the credit controller’s
problem rather than their own.
And that’s the problem. So our first
challenge is to coach/train our producers
to see money and matter as important
parts of the one conversation – that is,
treating both as normal.
Interestingly, clients have much the same
feelings. Mostly, they like talking with their
responsible lawyer about their matter. That’s
normal. But when they get phone calls from
a stranger they’ve never met demanding
payment for outstanding invoices, that’s
not normal and is often uncomfortable.
So if we can train our producers and our
clients that talking about matter and money
concurrently is normal, then we can kill two
birds with one stone. Everyone just accepts
it as the way things are.
And remember, who is a client most likely to
be guided by about money? The person who
they trust to run their matter. It’s not only the
best approach; it’s also the easiest approach.
Exactly how am I supposed
to do this?
The second reason for underperformance
in money conversations is the lack of a
robust framework that producers can rely
on to help them get the job done. As
mediators are wont to say – if all else
fails, trust the process.
PRELACS
We recommend an approach called
PRELACS. It’s a standard process to follow
when looking to extract commitment from
clients regarding payment. It doesn’t matter
whether you’re talking about unpaid past
accounts, or payments in anticipation of future
costs; it’s all the same using PRELACS.
We are also presuming here that these
guidelines are directed at the lawyer
responsible, but working with agreed money
management delegation from the partner.
P=plan
Firstly, if you are working on a matter
regularly, you should be right across the
essence of the fees agreement, particularly
if you weren’t the person who did the deal.
Before ringing your client about the matter,
go through their accounting information in
your practice management system and know
what is going on.
At a minimum, you should be across unpaid
invoices, current WIP, the likely next steps on
the matter, and any additional money due in
trust. Ideally, you should also be across the
whole of client financial relationship – in other
words, do the payment issues relate to more
than one matter? If so, talk with a partner and
develop an agreed plan of attack.
Important: Detail is king. If you are going
to talk about money, you need to be highly
specific about invoice numbers, actual
amounts, dates issued, and even be able
to email copies through instantly if required.
Being very specific means you mean
business. Being vague gives your client
excuses to avoid doing anything.
R=ring
Yes, ring. Don’t email. Don’t text. Email and
texts are too easily ignored. The good thing
about ringing is that you can engage with
your client on a two-way basis. Moreover,
you have them captive unless they are rude
enough to hang up. It is very hard for people
to stonewall in a phone conversation –
provided you have planned well.
Remember also that if you have planned
your conversation well, you will start positively
about the matter and then seamlessly slide
into ‘Now Geoff, while I’ve got you on the
phone, we need to work out how we can
tidy up a couple of your unpaid invoices...
I’ll just take you through them...’.